I often advise candidates that 85% of their best job leads come through their own personal network, not through recruiters. Maybe this information is bad for business (mine in particular) but I can't change the fact that most hiring managers will try to save time (and money) by finding candidates through their own network. When replacing someone on their team, the comfort of hiring a "known entity" vs. a complete unknown can make a critical difference. When someone else who is credible to the hiring manager can attest to the credibility of a potential employee, calibrating on the skill set and overall fit to the company becomes the primary focus. As the hiring manager already believes the referrer to be of good quality and caliber, it makes sense to think the referred candidate is, too. The hiring manager is more likely to hire that person based on "testimony" from the referrer that s/he is an excellent employee and well suited to the hiring company's environment. But that's not to say they are the best person for the job. While the hiring manager may have just saved themselves weeks or months in what could have been an exhausting, protracted and time consuming search, they may also have cost themselves more in the long run.
A strong referral is worth their weight in gold, but you could also be hiring a liability. Is it realistic to think that an employee can offer the same high level of performance across industry or company? Probably not. Calibrating on experience, skill set, level/fit to the role, education, flexibility, temperament, and cultural fit should be a part of every interview process...regardless of that candidate's performance in another company. Meeting comparative candidates in any search process can offer a dynamic perspective on what the market has to offer, and provides you choices. If your ideal candidate does come through your network, and an offer seems imminent, most candidates will understand that a company must honor their candidate calibration system in order to choose the best possible person. No one wants to make or become a hiring mistake. Exercising a thorough search also demonstrates the hiring manager's strategic sensibilities, thoughtful judgment and selectivity relative to all of their hires. Do you really want to work for someone who hires quickly and without a lot of due diligence? Can you imagine the sort of nightmare situations this could cause for you as an employee?
Experienced hiring managers know that due diligence on candidates must be performed to every extent prior to, or contingent with, an offer. That means interviews with their colleagues, peers, senior peers and other impartial/objective parties are to be given as much, if not more weight and consideration, than those who may be a bit biased as a result of the referral. Another critical aspect of the search relative to checks/balances are references and background checks as a requirement of employment. I have seen a few hiring managers make gut level decisions on candidates, and even extend an offer, without any intention of checking references. About 60-75% of these managers have a track record of making poor hiring decisions. They should have followed the reference process even if it did mean a risk of losing their candidate of choice because of timing or inconvenience. Ultimately, the employee was a spectacularly bad fit, and created headaches (including legal ones) that could have been easily avoided.